Press Release
July 18, 2016

Drilon eyes more equitable mining revenue sharing schemes

Senate President Franklin M. Drilon recently filed a proposed measure providing for a more equitable revenue sharing scheme between the government and mining industry.

"The State shall get a fair and equitable share of the revenues and economic benefits derived from the mining resources. Any economic rent arising from such exploration, extraction and utilization belongs to the State," the bill states. Under Senate Bill No. 225 or the Philippine Fiscal Regime and Revenue Sharing Arrangement for Large-scale Metallic Mining Act, Drilon explained that the government will get either 10 percent of gross revenue or 55 percent of adjusted net mining revenue (ANMR), whichever is higher.

The total government share will be divided between the national government and local government units at a 60-40 percent sharing scheme, respectively.

If the contract area is in an ancestral domain, however, the royalties for the indigenous cultural communities shall be taken from the government share, it adds.

Drilon said that a salient feature of the bill provides for speedier remittances of the LGU shares of ten days from the end of each quarter "in order to help the local communities immediately access their shares from mining activities in their locales."

"In the event that the ANMR Margin exceeds 50 percent due to increase in metal prices or other factors, the government, as owner of the mineral, shall get 55 percent of the threshold ANMR plus 60 percent on the excess ANMR," the bill states.

The payment of government share, Drilon further explained, shall be in lieu of all national and local taxes including corporate tax, royalty for the indigenous cultural communities, duties or imported specialized capital mining equipment, fees for mayor's and/or business permits, and other fees and charges being imposed by the host LGUs pursuant to the Local Government Code.

The bill covers all mining agreements (MAs) or Financial or Technical Assistance Agreements (FTAAs) entered upon the effectivity of the act. It will also govern the renewal and renegotiation of existing MAs or FTAAs.

"If passed into law, the bill would introduce a new fiscal regime and revenue sharing arrangement between the government and mining contractors for large-scale metallic mineral mining operations," Drilon said.

News Latest News Feed